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Socialized losses, privatized gains

Postmedia’s Michael Smyth came to Gordon Wilson’s defense after the LNG advocate was relieved of vague but costly responsibilities for gas industry promotion. But, did the political commentator make even a small effort to examine BC Liberal ambitions for this “generational opportunity”?

Given Postmedia’s partnership with the Canadian Association of Petroleum Producers (CAPP), perhaps Smyth has a mandate to shield everyone who assists the flow of subsidies worth billions to fossil fuel producers. At Postmedia, skepticism about the suitability of expanding fossil fuel interests may not be allowed.

Logical observers believe Wilson was more involved in furthering Christy Clark’s electoral success than in doing serious work to achieve fantabulous Liberal Party LNG promises.

I published the article that follows more than three years ago and I’ve been certain even longer that BC’s LNG prospects were less than dim. Anyone who had done similar research would be wondering why taxpayers wasted millions on projects doomed to fail.

Premier Christy Clark’s Liberal government says the development of liquefied natural gas in northern British Columbia represents a generational opportunity that has the potential to wipe out the provincial debt and eliminate the need to pay sales taxes.

The government’s throne speech delivered Tuesday — less than three months before the start of an election campaign — said LNG export possibilities represent a possible $1 trillion boost to B.C.’s gross domestic product over the next 30 years.

Clark announced in the throne speech a new B.C. Prosperity Fund that could accumulate between $100 billion and $260 billion in revenues from LNG royalties and business taxes, enough to wipe out the province’s current debt of $56 billion by 2028…”

Since the government’sBudget and Fiscal Plan 2014/15 – 2016/17predicts natural gas royalties about equivalent to unrecorded liabilities now owed producers, Premier Photo Op’s promise of wiping out provincial debt by 2028 depends on net royalties earned in fiscal years after 2017. Since Government projects provincial debt will grow to $69 billion by 2017, that will require a contribution of $6.3 billion a year from net natural gas royalties, which is about $6.2 billion more than BC has been averaging recently.

To accumulate revenues between $100 billion and $260 billion by 2043, the last half of Clark’s 30 year vision will have to produce between $3B and $17B annually. Anyone out there believe Clark’s government is serious about their numbers? Were they serious when they spoke of those dreams? Of course not.

However, what they are serious about is moving into private hands billions of dollars worth of public assets, with portions drifting into the hands of friendly insiders. That means, at least,

larger subsidies of gas exploration and production costs,

further royalty reductions and waivers,

payment by the public for transmission and transportation infrastructure,

alteration of income tax rules for accelerated write-offs and other benefits.

Multinational LNG operators want BC taxpayers to subsidize and assume commercial risks. It is a profitable strategy and one well practiced.Joseph Stiglitz, American Nobel Laureate, former chief economist for the World Bank and current Columbia economics professor says economic policies of governments are designed to transfer wealth from taxpayers to financial oligarchs. He said:

There’s a system where we socialize losses and privatize gains. That’s not capitalism, that’s not a market economy, that’s a distorted economy and if we continue with that we won’t succeed in growing, and we won’t succeed in creating a just society.

Without taxpayers taking on financial and environmental risks, BC’s LNG industry will be nothing more than a modest demonstration project created to further BC Liberal election prospects in 2017. The world’s business press reports:

Washington Post: “Russia now aims to pipe 38 billion cubic meters worth of gas to China annually. ‘This is the biggest contract in the history of the gas sector of the former USSR,’ trumpeted Russian President Vladimir Putin, who was on a visit to China this week.”What the epic China-Russia natural gas deal looks like

Wall Street Daily: [Sinopec] “is putting its first commercial shale gas field into production much sooner than expected… That should mean China will hit its target of 6.5 bcm of shale gas production by 2015. This is a target that western energy analysts had said was unrealistic, but now it’s within sight…”,China’s Long March to Shale Gas Development

Financial Times: “Chinese oil company Sinopec will put its first shale gasfield into commercial operation sooner than expected, aiming for annual production of 10bn cubic meters by 2017 as the country seeks to reduce its reliance on imported oil and gas….”Sinopec speeds up shale gas development

Reuters: “China may boast the world’s largest potential reserves of shale gas but is likely to lose to Australia in the race to be second behind the United States in bringing significant production on line…”Australia, not China, the next great shale gas hope

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LIberals have had no money to archive provincial documents for the last 10 years (I do not wonder why) and they have no money to improve public education. But, they have tens of billions of dollars to provide cheap power to industrial activities that employ relatively few people. There is one particular reason that public officials do things that make no financial sense. That reason may involve secret and foreign bank accounts.

Why not use BC natural gas as a transport fuel in BC? Trucks, buses, cars, trains, ferries can be converted fairly easily.Make a cheaper, cleaner fuel available to people and business and they will buy it.

BC Natural Gas = Fracking . Fracking can cause household water from the tap to burn. We can use the water from our taps to power our vehicles ! Energy independence achieved ! Christy Clark is a genius .I think it was Marie Antoinette who said ” Let them drink Dasani”.

ah and Hugh don't forget those welding schools in the Philippines where they are training welders for Canada, to be brought over under Jason Kenny's new “skilled workers” program. It will take only 10 days for them to be brought in, once requested. Then there will be Jason Kenny's program to permit corporations to bring their own employees if they have their “own” skill set.

Christy and her crew announced a million and change for welding schools in B.C. The Philippines has most likely spent more. The corporations will want to use foreign workers because they won't unionize.

If LNG and oil was really going to happen, you would think there would be welding courses in every high school in this province, so every kid who graduated had a welding certificate, if they wanted one. Oh, right, no school. works even better for Christy and her crew.

We don't need welders. There aren't any jobs. They sent the contracts for 3 ferries to Poland and the federal government still hasn't given the go ahead to build the military ships.

This province is over 60 billion in debt and going down faster every minute. When Christy and crew leave, we will be Detroit North.

Wasting money on destructive energy projects makes zero sense when there are better alternatives. British Columbia is spending billions on Site C. It could suspend the project today and have less harmful and cheaper sources of clean power operational by the time more electricity is needed.

As is typical of resource management, the regulating ministry sees its prime purpose is to enhance growth and profitability of companies extracting resources. the public share of produced values is no longer material. This cozy relationship costs taxpayers billions of dollars, money that could be spent on renewable energy, transit, daycare, education or many […]

Canada’s Conservatives are committed to the Republican Party value of opposing voter fraud, if someone else is doing it. Like their American mentors, HarperCons protest electoral manipulations even more strongly when no one is doing it. Bill C-76 amends the Canada Elections Act to establish spending limits for third parties and political parties before of a […]

Freelance reporter Bob Mackin wrote that BC’s Legislature was a scandal waiting to happen and he quoted journalism professor and former Legislative reporter Sean Holman about the significant potential for abuse. Mackin blames excessive secrecy and lack of transparency...

BC Hydro's quarterly report for the period ended September 30, 2018 shows the utility is very good at some things. Specifically, borrowing and spending money. In the thirteen years from 2005, assets employed to service BC consumers have almost tripled in value. Trouble is, actual sales to residential, commercial and industrial consumers are less in 2018 […]

The case is clear. British Columbia's Government decided to reduce the public share of natural gas revenues to almost nothing. This is despite substantial growth in the quantities of natural gas being extracted.

Perhaps an even more vile set of falsehoods is BC Hydro's continuing claims that demand for electricity by its BC consumers has been growing steadily. That has led to excessive capital spending that measures in the billions.

Check out the fine work on electoral reform by Merv Adey 2018 fellowship recipient Andrew Seal. It’s a fabulous five part series published by The Tyee. We’d like to raise additional funds to initiate the next fellowship. You can be sure it will support a comprehensive examination of a subject important to all British Columbians.